A low-income housing partnership gets 9100 relief to correct which year its credit period begins on Form 8609

Plain-English summary

A partnership that owns a low-income housing tax credit project had to pick when the building's 10-year credit period starts: either the year the building is placed in service, or, by irrevocable election under section 42(f)(1), the following year. On Form 8609 it accidentally checked line 10a to defer the start to the year after placement, even though its contemporaneous records show it intended the credit period to begin in the placed-in-service year. It caught the error after filing and asked for relief under Treasury Regulation 301.9100-3, which lets the IRS extend the time to make (or fix) a regulatory election when the taxpayer acted reasonably and in good faith and relief won't prejudice the government. The IRS granted the relief: the partnership has 120 days from the date of the letter to file an amended Form 8609 for the sole purpose of checking the correct box on line 10a. The ruling is limited to the timing election and expresses no opinion on whether the project or its buildings otherwise qualify for the credit.

Ruling snapshot

• Question: Should the IRS grant an extension of time under Treas. Reg. § 301.9100-3 to correct an inadvertent section 42(f)(1) credit-period election on Form 8609?
• Outcome: Approved (120-day extension to file an amended Form 8609 correcting line 10a)
• Key authorities: IRC § 42(f)(1), § 42(l)(1); Treas. Reg. § 301.9100-1, § 301.9100-3, § 301.9100-8

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
Washington, DC 20224

Number: 202144014 [Third Party Communication:
Release Date: 11/5/2021 Date of Communication: Month DD, YYYY]
Index Number: 42.00-00, 9100.00-00
Person To Contact:
----------------------- -----------------, ID No. -----------------
--------------------------- Telephone Number:
------------------------------------- ---------------------
------------- Refer Reply To:
--------------------------------------- CC:PSI:B05
PLR-103174-21
In Re: Date:
------------------------------- August 6, 2021

LEGEND

Taxpayer = ----------------------------------------------------------------------------------------------
------------------------
----------------------------------------------------------------------------------------------
State = ---------

Address = ----------------------------------------------------------------------------------------------
-------------------------------

a = ----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
BIN = -----------------

Year = -------

Dear -----------:

    This letter responds to Taxpayer’s authorized representative’s letter dated

January 12, 2021, and subsequent correspondence, submitted on behalf of Taxpayer,
requesting an extension of time, pursuant to §§ 301.9100-1 and 301.9100-3 of the
Procedure and Administration Regulations, to file an amended Form 8609, Low-Income
Housing Credit Allocation and Certification, with respect to the election under § 42(f)(1)
of the Internal Revenue Code made for a certain building in a housing project intended
to be a low-income housing project under § 42.
PLR-103174-21 2

    According to the information submitted and representations made, Taxpayer, a

partnership for federal income tax purposes, owns and operates a multi-building
housing project in State. The project is located at Address. The project received an
allocation of the low-income housing credit under § 42. The project consisted of a
buildings for § 42 purposes. The building identified by BIN is part of the project.
Taxpayer placed the building identified by BIN in service in Year. Taxpayer intended,
as reflected by contemporaneous and other documents, to begin the credit period for
the building identified by BIN in Year. However, in preparing Form 8609 for the building
identified by BIN, Taxpayer inadvertently checked the box on Form 8609, line 10a, to
begin the credit period for the building the first year after the building was placed in
service. After filing Forms 8609 with the Internal Revenue Service (IRS), Taxpayer
discovered the inadvertent error.

    Section 42(f)(1) defines the credit period of any building as the period of 10

taxable years beginning with the taxable year in which the building is placed in service,
or at the taxpayer’s irrevocable election, the succeeding taxable year, but in either case
only if the building is a qualified low-income building at the close of the first year of the
credit period.

   Section 301.9100-8(b) provides that the election under § 42(f)(1) generally must

be made for the taxable year in which the building is placed in service, or the
succeeding taxable year if the § 42(f)(1) election is made to defer the start of the credit
period, and must be made in the certification required to be filed pursuant to § 42(l)(1)
and (2). Section 301.9100-8(a)(4)(i) provides that the election under § 42(f)(1) is
irrevocable.

   Specifically, the election under § 42(f)(1) is made pursuant to the certification

requirement of § 42(l)(1)(E), which provides that following the close of the first taxable
year in the credit period with respect to any qualified low-income building, the taxpayer
shall certify to the Secretary (at such time and in such form and in such manner as the
Secretary prescribes) such other information as the Secretary may require.

    Section 1.42-1(h) of the Income Tax Regulations provides that a completed Form

8609 must be filed by the building owner with the IRS. The requirements for completing
and filing Form 8609 are addressed in the instructions to the form.

   The instructions to Form 8609 provide that the building owner must make a one-

time submission of Form 8609 to the Low-Income Housing Credit (LIHC) Unit at the IRS
Philadelphia campus. The building owner must file the original of the Form 8609 with
the LIHC Unit no later than the due date (including extensions) of its first tax return with
which it is filing Form 8609-A, Annual Statement for Low-Income Housing Credit.
PLR-103174-21 3

   Sections 301.9100-1 through 301.9100-3 provide the standards the

Commissioner will use to determine whether to grant an extension of time to make an
election.

   Section 301.9100-1(b) defines the term “regulatory election” as including an

election whose due date is prescribed by a regulation published in the Federal Register,
or a revenue ruling, revenue procedure, notice, or announcement published in the
Internal Revenue Bulletin.

   Under § 301.9100-1(c), the Commissioner has discretion to grant a reasonable

extension of time under the rules set forth in §§ 301.9100-2 and 301.9100-3 to make a
regulatory election, or a statutory election (but no more than six months except in the
case of a taxpayer who is abroad), under all subtitles of the Code except subtitles E, G,
H, and I.

   Section 301.9100-2 provides automatic extensions of time for making certain

elections. Section 301.9100-3 provides extensions of time for making elections that do
not meet the requirements of § 301.9100-2.

   Requests for relief under § 301.9100-3(a) will be granted when the taxpayer

provides evidence (including affidavits described in § 301.9100-3(e)) to establish that
the taxpayer acted reasonably and in good faith, and that granting relief will not
prejudice the interests of the government.

    Based solely on the facts submitted and the representations made, we conclude

that the requirements of §§ 301.9100-1 and 301.9100-3 have been met. Accordingly,
Taxpayer is granted an extension of time to file an amended Form 8609 for the building
identified by BIN for the sole purpose of checking the correct box on line 10a of the form
to begin the credit period for the building in Year. The amended Form 8609 must be
filed within 120 days from the date of this letter. The amended Form 8609 (along with a
copy of this letter) must be filed with the LIHC Unit at the following address provided in
the instructions to Form 8609:

   Department of the Treasury
   Internal Revenue Service Center
   Philadelphia, PA 19255-0549

   No opinion is expressed or implied regarding the application of any other

provisions of the Code or regulations. In particular, we express no opinion on whether
the project is a qualified low-income housing project or whether the building identified by
BIN or other buildings in the project otherwise qualify for the low-income housing credit
under § 42.

  This ruling is directed only to the taxpayer who requested it. Section 6110(k)(3)

provides that it may not be used or cited as precedent.
PLR-103174-21 4

  The ruling contained in this letter is based upon information and representations

submitted by Taxpayer and accompanied by a penalty of perjury statement executed by
an appropriate party. While this office has not verified any of the material submitted in
support of the request for rulings, it is subject to verification on examination.

                                       Sincerely,

                                       Associate Chief Counsel
                                       (Passthroughs and Special Industries)



                                 By:
                                       Nicole Cimino
                                       Chief, Branch 5
                                       Office of Associate Chief Counsel
                                       (Passthroughs and Special Industries)

Enclosure:
Copy for § 6110 purposes

cc: